Setting aside a financial agreement
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Setting aside a financial agreement
A financial agreement is a binding contract between parties that sets out how assets and liabilities will be divided. In certain circumstances, you may be able to apply to a court to have a financial agreement set aside if it no longer reflects your situation or if there are concerns about how it was made. This guide explains what setting aside a financial agreement means, the grounds on which you can apply, and what the process involves.
What it means to set aside a financial agreement in Australia
A financial agreement is a legally binding contract between partners that outlines how assets, liabilities, and financial matters will be handled during a relationship or if it breaks down. Setting aside a financial agreement means asking a court to declare the agreement invalid or no longer binding, effectively cancelling it.
In Australia, financial agreements are governed by the Family Law Act. They allow couples to take control of property division rather than relying on court decisions. However, there are strict legal requirements these agreements must meet to be enforceable.
When circumstances change significantly, or if the agreement was not properly created, you may seek to challenge prenup arrangements or other financial agreements. You might challenge a prenup if you believe an invalid financial agreement exists because essential steps were missed during its creation.
An invalid financial agreement can arise if proper disclosure was not provided, if either party lacked independent legal advice, or if the agreement was signed under pressure. When you want to set aside financial agreement arrangements, you'll need to demonstrate one of these grounds to a court.
Key points
Financial agreements must meet strict legal requirements to be enforceable
Both parties must have received independent legal advice before signing
Full financial disclosure is essential for the agreement to be valid
Courts can set aside agreements if requirements were not properly followed
The grounds for challenging vary and depend on your specific circumstances
Professional guidance helps clarify whether your situation has legitimate grounds
Common situations
You may be considering setting aside a financial agreement if:
You and your ex-partner made an agreement years ago that no longer reflects your financial circumstances
One party did not receive independent legal advice when the agreement was signed
There was significant non-disclosure of assets or liabilities at the time
Your financial situation has changed dramatically due to inheritance, business growth, or other major events
You now believe the agreement was unfair or was signed under pressure
One party misrepresented their financial position
The agreement was never properly documented or witnessed
You want to revisit property settlement terms without going through full court proceedings
You discover the agreement does not accurately reflect what was actually agreed verbally
If an agreement was not properly created or contains fundamental flaws, attempting to enforce it later can lead to disputes, delays, and uncertainty about your rights. Courts may need to intervene to clarify what is actually binding. This can be time-consuming and costly if the matter becomes contested.
What to consider
Was independent legal advice truly given to both parties before signing?
Did you fully understand the agreement at the time you signed it?
Has there been a significant change in circumstances since the agreement was made?
Do you have copies of all original documents and correspondence?
What type of binding financial agreement did you create (prenuptial, post-separation, or de facto)?
Are there any concerns about lack of disclosure when the agreement was made?
How much time has passed since the agreement was signed?
What are the practical and financial implications of seeking to set it aside?
What you can do next and how LawConnect can help
If you believe your financial agreement should be set aside, you may wish to:
Gather copies of the original agreement and all related documents from the time it was signed
Make a list of any concerns about how it was created or any changed circumstances
Note any potential breaches or failures to meet legal requirements
Document any significant changes to your financial position since signing
Consider whether you understand the full grounds on which courts might set aside agreements
Identify what outcome you hope to achieve if the agreement is cancelled
Explore whether discussion or negotiation with your ex-partner is possible first
How LawConnect can help
Setting aside a financial agreement can feel complex, especially when you're uncertain about what legal grounds might apply to your situation. LawConnect provides personalised legal information through our AI legal assistant, which can help you understand how property settlement options work, what kind of binding financial agreement you may have, and the general steps involved in challenging an agreement.
Our AI assistant acts as an information tool to help you explore the range of options that may be available and to clarify general legal concepts. However, only a licensed lawyer can review your specific agreement, assess your circumstances, and provide legal advice on whether you have grounds to set aside the arrangement and what strategy might work best for you.
If you'd like to move forward with professional advice, we can connect you with a family lawyer who can assess your situation, explain your options, and guide you through the formal process. Taking steps to understand your position early may help you make informed decisions about whether to pursue this path.
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Setting aside a financial agreement FAQs
Yes, a prenuptial agreement (financial agreement made before marriage) can be challenged in certain circumstances. Common grounds include lack of proper financial disclosure, absence of independent legal advice, or evidence of unconscionable conduct by one party. To succeed in challenging a prenup, you generally need to demonstrate that the agreement does not meet strict legal requirements or that circumstances have significantly changed since it was made.
A financial agreement may be set aside if the court finds it was unjust or unfair when it was made. This depends on factors such as whether both parties received independent legal advice, full financial disclosure occurred, and whether one party exercised undue influence. The court may also set aside an agreement if there has been a material change in circumstances since execution, though this threshold is generally high.
A financial agreement may be invalid if it fails to meet technical requirements set out in the Family Law Act, such as being in writing or lacking proper declarations from lawyers. It may also be invalid if executed without informed consent, proper disclosure of financial positions, or independent legal advice. Additionally, agreements made under duress, fraud, or unconscionable conduct may be rendered invalid by a court.